In today’s briefing:
- Meidong: Insights from Call with the Management for H1 2022
- Index Rebalance & ETF Flow Recap: S&P/ASX, CH50/A50, TW50/Div+, NIFTY50/100, STI, EPRA, Sensex
- Weekly Deals Digest (04 Sep) – Giordano, BYD, Link Net, MACA, Nitro, Nearmap, Leapmotor, Onewo
- Lichen China IPO Preview: Your Trusted Provider of Financial and Taxation Services
- Onewo IPO: The Bear Case
- ECM Weekly (4th Sep 2022) – China ADRs, Tencent, Leapmotor, Onewo, Hongjiu Fruit, Doosan Ener
- (Mostly) Asia-Pac Weekly Risk Arb Wrap: Nitro Software, MACA, Giordano, Link Net
Meidong: Insights from Call with the Management for H1 2022
- China MeiDong Auto (1268 HK) presents an excellent investment opportunity, trading at 13.3x/8.1x FY22/23e, post street estimate revisions downwards with a dividend yield of 6.0%/10% (assuming an 80% payout).
- China MeiDong Auto (1268 HK) ‘s integration of Starchase is progressing better than we expected, with metrics on inventory dramatically improving. We believe the management will focus on aftersales now.
- The company will join the EV bandwagon by collaborating on aftersales with players having operational (not financial) difficulties performing this service, presenting a good opportunity for the company.
Index Rebalance & ETF Flow Recap: S&P/ASX, CH50/A50, TW50/Div+, NIFTY50/100, STI, EPRA, Sensex
- There were a bunch of rebalance announcements last week from FTSE and Nifty, and implementation of changes to the MSCI, JPXNK400 and Hang Seng indexes.
- The changes to the Nikkei 225 (NKY INDEX) should be announced early in the coming week and the changes to the SSE STAR50 (STAR50 INDEX) will be implemented on Friday.
- There were large inflows to China and Hong Kong focused ETFs during the week.
Weekly Deals Digest (04 Sep) – Giordano, BYD, Link Net, MACA, Nitro, Nearmap, Leapmotor, Onewo
- A weekly summary of key developments across ECM and Event-Driven names tracked by us across Hong Kong, Australia, New Zealand, Singapore, Indonesia, Malaysia, Thailand, Korea, India and Chinese ADRs.
- ECM developments – Leapmotor (2007699D HK) and Onewo Space-Tech (ONEWO HK) are pre-marketing a US$1.5 billion and US$2.0 billion HKEx IPO, respectively.
- Event-Driven developments – BYD (1211 HK), Giordano International (709 HK), MACA Ltd (MLD AU), Nitro Software Ltd (NTO AU), Link Net (LINK IJ).
Lichen China IPO Preview: Your Trusted Provider of Financial and Taxation Services
- Lichen China, niche provider of financial and taxation services, filed for an IPO in the United States, and plans to raise ~$25M. Investment bank Univest Securities is leading the offering.
- The company applied to list Class A shares on the Nasdaq Capital Market under the symbol Lichen China (LICN US) and will have Class A shares and Class B shares.
- We have a favorable view of the upcoming IPO, and consider an IPO valuation of ~$119M as attractive at ~2x EV/FY22E revenue and a forward P/E of ~14x.
Onewo IPO: The Bear Case
- Onewo Space-Tech (ONEWO HK), China Vanke Co Ltd (H) (2202 HK)’s property management unit, has begun pre-marketing a US$2.0 billion HKEx IPO.
- In Onewo IPO: The Bull Case, we highlighted the key elements of the bull case. In this note, we outline the bear case.
- The key elements of the bear case rest on the organic growth rates half of the reported rates, slow revenue diversification, lacklustre gross margin and declining contract liabilities ratio.
ECM Weekly (4th Sep 2022) – China ADRs, Tencent, Leapmotor, Onewo, Hongjiu Fruit, Doosan Ener
- Aequitas Research puts out a weekly update on the deals that were covered by the team recently along with updates for upcoming IPOs.
- On the IPO front, things are starting to move with Leapmotor and Onewo, while CALB continues to have second thoughts.
- The biggest placement this week was Doosan, but there was news of Tencent setting its sights on sizeable future placements via divestments.
(Mostly) Asia-Pac Weekly Risk Arb Wrap: Nitro Software, MACA, Giordano, Link Net
- There are 49 – mostly firm, mostly Asia-Pac – transactions currently being discussed and analysed on Smartkarma. Inside is a timetable of upcoming key events for each deal.
- One new deal was discussed this week: Potentia’s rejected proposal for Nitro Software Ltd (NTO AU).
- Key updates took place for MACA Ltd (MLD AU), Giordano International (709 HK), and Link Net (LINK IJ).
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